Savings, Savings, Savings

Ethan Miller, Financial Planner

February 19, 2017

Our country’s financial resilience in a sorry state. Nearly half of all Americans don’t have enough money saved to easily cover an unexpected $400 expense. Some say they would borrow from a friend or family member to cover the cost, others would put it on a credit card to pay off over time, get a payday or other loan, sell something or try to avoid the expense all together.

And of course, there are a lot of reasons for our country’s savings crisis. From stagnating wages to ballooning mortgage debt and government policy, there are a lot of obstacles holding working people back from being able to save enough for emergencies, not to mention for retirement or large purchases.

 

But by starting now, there’s a lot that you can do to overcome these barriers and build a strong financial foundation. The simple fact is that if you’re not putting some money away into savings every month, you need to start. You can begin by putting away just $50 or $100 a month, and if possible, you should set this up as an automatic transaction from your checking account to your savings on the same day you get your paycheck. When thinking about your financial priorities, don’t forget to include your own stability.

Over time, you should slowly build an emergency fund you can rely on for those unforeseen expenses. Ideally you have between 3 to 6 months worth of expenses saved and liquid (able to be converted to cash without losing value). You’ll find that having an emergency fund can go a long way in relieving stress and giving yourself the flexibility to absorb the bumps that life inevitably throws at you. And once you build up your emergency fund, you can start saving for other goals, like a down-payment on a house, a new car, or retirement. But that’s another blog post all together.

Want to learn more about how you can work with Planning for Progress to start on the path to financial sustainability and get objective, personalized financial advice? Schedule a free 30-minute introductory call today!

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